How to avoid this mistake: Ask a mortgage lender about your first-time home buyer options and look for programs in your state. You might qualify for a U.S. Department of Agriculture loan or one guaranteed by the Department of Veterans Affairs that doesn’t require a down payment. Federal Housing Administration loans have a minimum down payment of 3.5%, and some conventional loan programs allow down payments as low as 3%.
| |RateShield Approval locks your initial interest rate for up to 90 days on 30-year conventional, FHA and VA fixed-rate purchase loan products. Your exact interest rate will depend on the date you lock your rate. Once you submit your signed purchase agreement, we’ll compare your rate to our published rates for that date and re-lock your interest rate at the lower of the two rates for an additional 40 to 60 days. Quicken Loans reserves the right to cancel this offer at any time. Acceptance of this offer constitutes the acceptance of these terms and conditions, which are subject to change at the sole discretion of Quicken Loans. This is not a commitment to lend. Additional conditions or exclusions may apply.
Begin by house hunting online, whether your agent is sending you homes listed on the market through the local multiple listing service, or you're checking out consumer-facing marketing sites like Zillow, Trulia, realtor.com or Redfin. It’s easy to narrow your online searches by setting boundaries around the neighborhood or general part of the city you hope to buy in.

Wouldn't it be great if buying a home were as simple as it is in a game of Monopoly? All you'd have to do is find a desirable neighborhood, hand the bank a few bucks, and you'd receive a house. Of course, the home-buying process is a bit more complicated in real life (especially for first-time home buyers), but it's not impossible. Competition among buyers in many markets has gotten intense, so if you're serious about homeownership, you'd better get your act together. To point you in the right direction, we've prepared a road map of the home-buying process. From choosing the right professionals to signing that final contract, here are the typical steps you need to be aware of.

Arrange for a home inspector to look over the property. The real estate agent can help locate a reputable inspector for the task. A qualified inspector will check the foundation of the home, plumbing, electrical systems, the roof, walls, and visible insulation. An inspector will also look for signs of mold, asbestos, and pests. A home inspection is generally one of the steps to buy a house that is being resold.
Your agent may generally know which home you are going to choose, due to experience and intuition. However, make sure that you don't feel your agent is trying to steer you toward any specific property, and choose the home without interference from the agent because it's your choice as the buyer alone to make. Keep in mind, however, that real estate agents are required to point out defects and should help buyers feel confident that the home selected meets the buyer's stated search parameters.
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Let the serious shopping begin! By now you’ve talked things over with your agent and you both know what you really want and need in a home. Armed with this, your price range and knowledge of the local area, look at listings online and with your agent, who will come up with properties for you to tour. Chances are you’ll discover some new things to love or hate about homes and refine your search.
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Many realtors will not spend time with clients who haven't clarified how much they can afford to spend. And in most instances, sellers will not even entertain an offer that’s not accompanied with a mortgage pre-approval. That's why – if you don't have all cash (how many first-time buyers do do?) – your next step is talking to a lender and/or mortgage broker.
Once negotiations have finalized, the contract has been signed and you’ve provided a small amount of cash as a deposit or earnest money, you’ll have a few days to conduct your due diligence on the property. That includes the home inspection, which will tell you if there are any issues with the property that could affect the amount you’re willing to pay or if there’s anything that should be repaired before you move in.
If you're like most first-time home buyers, you've probably listened to friends', family's and coworkers' advice, many of whom are encouraging you to buy a home. However, you may still wonder if buying a home is the right thing to do. Relax. Having reservations is normal. The more you know about why you should buy a home, the less scary the entire process will appear to you. Here are eight good reasons why you should buy a home.
When you’ve found a local lender, you’ll have to submit your financial information to get pre-approved, including tax forms and W-2s, recent pay stubs, savings, retirement accounts, and debt obligations. After reviewing all of this information, the lender will let you know the size mortgage for which you can qualify and provide a letter that shows you’re pre-qualified. In the meantime, keep track of all those financial forms and add new pay stubs and bank statements to the file, as you’ll need them again. That pre-approval letter usually expires after 60 or 90 days, so if you haven’t found your home before it expires, you’ll just have to resubmit the paperwork.
You might have some empty rooms for a little while, but your budget and your future selves will thank you! And if you find yourself thinking, Oh well, I’ll just put it on credit—stop right there! Debt is dumb. Plus, taking on new debt in the middle of buying a house could delay your approval for a mortgage and make you miss out on the perfect home. Don’t do it!
The good news? There is a tried-and-true formula, involving multiple good financial steps and habits, that can lead you directly to the purchase of your dream home, and on a fast schedule, too. The downside is simple and direct -- if you don't follow the home buying formula, your chances of landing a new home are significantly reduced, if not completely eliminated.
Following a decline in homeownership after the Great Recession, homeownership rates nationwide are above 64 percent as of the first quarter of 2018, according to the U.S. Census Bureau. While homeownership has not returned to its historical peak of 69.2 percent in 2004, it is edging upward again after hitting a 50-year low in mid-2016 at 62.9 percent.

Do some research online, but work with a live person who can review your situation, answer questions and, if necessary, suggest how you can improve your credit.“Online calculators do not always include insurance and taxes or PMI [private mortgage insurance required if the down payment is less than 20%] and are not always an accurate picture of what the payment or actual fees for the loan are,” says Anita Wagoner Brown, director of sales and marketing for Home Creations, the largest new home builder in Oklahoma.
Closing costs: These are fees you have to pay when you close on your mortgage. They’re based on the individual purchase, but can vary from 2% to 7% of the purchase price of the home, but they’re often split between the buyer and seller. According to Realtor.com, buyers typically pay 3% to 4% in closing costs and sellers typically pay 1% to 3% (you can try to negotiate who pays which closing costs). With some closing costs, you have to use a certain service, but with others, you’re allowed to shop around for a better price. Here are some common closing costs.
Once a seller accepts your offer, the closing process will begin. Keep things running smoothly by knowing what to expect when closing on a house. The average closing process takes 41 days, which gives you plenty of time to tackle closing items.(5) A real estate agent will schedule the remaining steps, from home inspection to final walkthrough, and keep you informed about any road blocks.
Fixer-uppers are all the rage these days, as many homebuyers are willing to take on renovation projects in exchange for a slightly lower price tag. But when budgeting for your renovations, leave plenty of room for the discovery of existing problems once your contractor looks behind the walls. The HomeAdvisor survey found 51 percent of homeowners spent more time on home projects than they expected. “Even if you have a fully vetted, well-reviewed contractor … they still might uncover issues that maybe a previous contractor left incomplete,” Hunter says. He recommends leaving around 10 percent extra space in your budget for surprise problems of any kind.
Once you’re ready to start home buying, it’s offer time. Here’s where you’ll thank yourself for working with a real estate agent. They’ll help you determine the right offer to make for a particular house, including things that go beyond the dollar amount. For instance, offering an accelerated closing date or to buy and lease back to the buyer if they can’t move right away may be a smart move in some situations. When you make an offer on a house, the seller may accept it or counter-offer, and then your agent will help you decide how and if to negotiate. Once you arrive at a deal everyone likes, you’re considered under contract to buy the house.
Preapproval is the second step in the mortgage process. You complete a mortgage application and provide detailed information to the lender (although you will not yet have a house picked out most likely, so the property information can be left blank). The lender will approve you for a specific amount and you will get a better idea of your interest rate. This puts you at an advantage with a seller because the seller will know you’re one step closer to getting a mortgage.
Many home shoppers use a lender who was recommended by a friend, family member or real estate agent, and they don’t bother shopping around. But that doesn’t guarantee you’ll get the best rate, or even get a lender who is experienced with loans for your particular situation. The CFPB recommends talking to at least three lenders to get the best loan for you.
Find out how familiar the agent is with the areas you want to look at. If they have little expertise and no network in the neighborhood, then you won’t get the agent advantage of being the first to see a house (sometimes even before it’s listed) or getting expert advice on price. Plus, neighborhood knowledge saves the buyer time because an agent will likely know exactly where to look and what houses to show based on your needs.
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